AAX, expected to launch in H1 2019, will be the first digital asset exchange venue to use the Millennium Exchange matching engine. The implementation leverages the market leading technology, used across London Stock Exchange Group and other global client trading venues, as the basis for ATOM’s new digital asset exchange.

Peter Lin, CEO of ATOM Group said:“Trust is at the heart of ATOM’s philosophy and we are delighted to be working with LSEG Technology to deliver a core part of our new digital asset exchange. AAX will leverage LSEG’s Technology to deliver a world-class exchange that ensures safe, trusted and secure digital asset trading for all. The AAX exchange will allow investors to trade all major digital assets with greater levels of fairness, transparency, and performance.”

Ann Neidenbach, CIO, LSEG Technolog

Ann Neidenbach, CIO, LSEG Technology said:“We are delighted to have been selected by ATOM™ to provide a best-in-class technology solution to help power its new exchange. It underlines Millennium Exchange’s reputation for performance, scalability, flexibility and reliability and we look forward to working with the AAX team ahead of the launch in H1 2019.”

ATOM Group is a global fintech company based in Hong Kong with a focus on blockchain technologies and emerging digital assets.

Washington D.C., Nov. 8, 2018 — The Securities and Exchange Commission today announced settled charges against Zachary Coburn, the founder of EtherDelta, a digital “token” trading platform. This is the SEC’s first enforcement action based on findings that such a platform operated as an unregistered national securities exchange.

According to the SEC’s order, EtherDelta is an online platform for secondary market trading of ERC20 tokens, a type of blockchain-based token commonly issued in Initial Coin Offerings (ICOs). The order found that Coburn caused EtherDelta to operate as an unregistered national securities exchange.

EtherDelta provided a marketplace for bringing together buyers and sellers for digital asset securities through the combined use of an order book, a website that displayed orders, and a “smart contract” run on the Ethereum blockchain. EtherDelta’s smart contract was coded to validate the order messages, confirm the terms and conditions of orders, execute paired orders, and direct the distributed ledger to be updated to reflect a trade.

Over an 18-month period, EtherDelta’s users executed more than 3.6 million orders for ERC20 tokens, including tokens that are securities under the federal securities laws. Almost all of the orders placed through EtherDelta’s platform were traded after the Commission issued its 2017 DAO Report, which concluded that certain digital assets, such as DAO tokens, were securities and that platforms that offered trading of these digital asset securities would be subject to the SEC’s requirement that exchanges register or operate pursuant to an exemption. EtherDelta offered trading of various digital asset securities and failed to register as an exchange or operate pursuant to an exemption.

“EtherDelta had both the user interface and underlying functionality of an online national securities exchange and was required to register with the SEC or qualify for an exemption,” said Stephanie Avakian, Co-Director of the SEC’s Enforcement Division.

“We are witnessing a time of significant innovation in the securities markets with the use and application of distributed ledger technology,” said Steven Peikin, Co-Director of the SEC’s Enforcement Division. “But to protect investors, this innovation necessitates the SEC‘s thoughtful oversight of digital markets and enforcement of existing laws.”

Without admitting or denying the findings, Coburn consented to the order and agreed to pay $300,000 in disgorgement plus $13,000 in prejudgment interest and a $75,000 penalty. The Commission’s order recognizes Coburn’s cooperation, which the Commission considered in determining not to impose a greater penalty.

The SEC’s investigation, which is continuing, is being conducted by Daphna A. Waxman of the Division’s Cyber Unit and Alison R. Levine and Jorge G. Tenreiro of the New York Regional Office. The case is being supervised by Robert A. Cohen, Cyber Unit Chief.

Deutsche Bundesbank and Deutsche Börse have successfully completed the performance tests of their jointly specified prototypes for securities settlement based on blockchain technology. The Blockchain prototypes support the settlement of securities transactions, payments, interest payments and repayments at the maturity of a bond. It was developed on both Hyperledger Fabric (version 1.0) and the Digital Asset Platform and subjected to demanding performance tests.

The tests showed that both prototypes are suitable for the productive operation of a realistic financial market infrastructure and can serve as a basis for further development. Both the Digital Asset Platform and the Hyperledger Fabric have had subsequent releases which may even improve the performance.

“During this project, Deutsche Bundesbank and Deutsche Börse learned a lot about the usage of this technology and its concrete implementation. We expect the rapid development to continue, and also see the potential in using it for high-volume applications. The approach of a permissioned architecture, which takes into account the requirements of the financial sector from the outset, has proven to be right,” said Burkhard Balz, Member of the Executive Board of Deutsche Bundesbank.

Berthold Kracke, CEO of Clearstream Banking AG and Head of Clearstream Global Operations at Deutsche Börse Group, said “We are very happy with the results of the project. The tests have shown that blockchain technology is a suitable basis for applications in the field of settlement and other financial infrastructures. Thanks to the cooperation with Deutsche Bundesbank and the expertise of Digital Asset, we were able to tailor the product to the needs of the industry.”

The blockchain-based prototypes are a result of a collaborative research project between Deutsche Börse and the Deutsche Bundesbank to undertake blockchain based settlement technology research (in short: BLOCKBASTER). You can find the essential results of the project in the joint publication “BLOCKBASTER, Final Report“ below.

Washington D.C., Oct. 22, 2018 —The Securities and Exchange Commission today suspended trading in the securities of a company amid questions surrounding its statements about partnering with a claimed SEC-qualified custodian for use with cryptocurrency transactions and a purportedly registered public offering of preferred stock.

The SEC’s trading suspension order says that two August 2018 press releases issued by Nevada-based American Retail Group, Inc. (OTC: ARGB) aka Simex, Inc. claimed that the company had partnered with an SEC qualified custodian for use with cryptocurrency transactions that would be “under SEC Regulations,” and that the company was conducting a token offering that was “officially registered in accordance [with] SEC requirements.”

Earlier this month, the SEC issued an investor alert that warned investors to be vigilant for false claims about SEC endorsements used to promote digital asset investments.

Robert A. Cohen, Chief of the SEC Enforcement Division’s Cyber Unit

“The SEC does not endorse or qualify custodians for cryptocurrency, and investors should use vigilance when considering an investment in an initial coin offering,” said Robert A. Cohen, Chief of the SEC Enforcement Division’s Cyber Unit.

Under the federal securities laws, the SEC can suspend trading in a stock for 10 days and generally prohibit a broker-dealer from soliciting investors to buy or sell the stock again until certain reporting requirements are met.

The SEC’s Office of Investor Education and Advocacy has issued an Investor Bulletin on initial coin offerings and a mock ICO website to educate investors. Additional information about ICOs is available on Investor.gov and SEC.gov/ICO.

The SEC appreciates the assistance of the Financial Industry Regulatory Authority.

Washington, DC – A New York federal court has ordered New York corporation Gelfman Blueprint, Inc. (GBI) and its Chief Executive Officer Nicholas Gelfman of Brooklyn, New York, to pay in total over $2.5 million in civil monetary penalties and restitution in what was the first anti-fraud enforcement action involving Bitcoin filed by the Commodity Futures Trading Commission (CFTC) (see CFTC Complaint and Press Release 7614-17).

James McDonald, the CFTC’s Director of Enforcement, commented: “This case marks yet another victory for the Commission in the virtual currency enforcement arena. As this string of cases shows, the CFTC is determined to identify bad actors in these virtual currency markets and hold them accountable.I’m grateful to the members of Enforcement’s Virtual Currency Task Force for their tireless work on these matters.”

Together, the Order for Final Judgment by Default (Default Order), and the Consent Order for Final Judgment (Consent Order) (collectively, the Orders), entered respectively on October 2, 2018 and October 16, 2018, by Judge P. Kevin Castel of the U.S. District Court for the Southern District of New York, resolve the charges of the CFTC Complaint against GBI and Gelfman filed on September 21, 2017.

The Orders find that from approximately 2014 through approximately January 2016, Defendants Gelfman and GBI, by and through its officers and agents and employees, operated a Bitcoin Ponzi scheme in which they fraudulently solicited more than $600,000 from at least 80 customers. As stated in the Orders, the customers’ funds supposedly were for placement in a pooled commodity fund that purportedly employed a high-frequency, algorithmic trading strategy executed by Defendants’ computer trading program called “Jigsaw.”In fact, as the Orders indicate, the strategy was fake, the purported performance reports were false, and—as in all Ponzi schemes—payouts of supposed profits to GBI Customers in actuality consisted of other customers’ misappropriated funds.Also, the Consent Order finds that Gelfman was liable as a controlling person for GBI’s violations, and the Default Order finds that GBI was liable as a principal for the violations of Gelfman and its other officers, agents, and employees.

The Orders find that, to conceal Defendants’ trading losses and misappropriation, Defendants made and provided false performance reports to pool participants, including statements that created the appearance of positive Bitcoin trading gains, when in truth Defendants’ Jigsaw trading account records reveal only infrequent and unprofitable trading. The Orders also find that Gelfman, in order to conceal the scheme’s trading losses and misappropriation, staged a fake computer “hack” that supposedly caused the loss of nearly all customer funds.

In addition to requiring GBI and Gelfman, respectively, to pay $554,734.48 and $492,064.53 in restitution to customers and $1,854,000 and $177,501 in civil monetary penalties, the Orders impose permanent trading and registration bans on GBI and Gelfman and permanently enjoin them from further violations of the Commodity Exchange Act and CFTC Regulations, as charged.

The CFTC cautions that orders requiring repayment of funds to victims may not result in the recovery of any money lost because the wrongdoers may not have sufficient funds or assets. The CFTC will continue to fight vigorously for the protection of customers and to ensure the wrongdoers are held accountable.

The CFTC appreciates the cooperation and assistance of the New York County District Attorney’s Office and the Finland Financial Supervision Authority.

This case was brought in connection with the Division of Enforcement’s Virtual Currency Task Force, and the CFTC Division of Enforcement staff members responsible for this case are Gates S. Hurand, Christopher Giglio, K. Brent Tomer, Lenel Hickson, Jr., and Manal M. Sultan.

Apple’s co-founder Steve Wozniak has joined VC firm EQUI Global to head up technology investments and help find and coach the next big technology firms. The VC firm is set to distribute its own cryptocurrency on digital asset trading platforms.

EQUI Global founded by founder Doug Barrowman, and co-founders Baroness Michelle Mone OBE and Steve Wozniak, is innovating the field of venture capital. Its blockchain ‘back end’ allows value to be well-informed and then traded in the open market through the EquiToken.

The fund allows investors the opportunity to sell their EquiTokens on external cryptocurrency exchanges at a time of their choosing. Non-institutional investors are welcomed to buy into the Fund and then trade out through the liquidity created by the EquiToken, built on the Ethereum platform.

“I get ideas pitched to me every single day in fact dozens and I always say no. Since I co-founded Apple with Steve Jobs, this is about the second time in twenty years that I actually said yes, I want to be a part of this. It has to be something I really believe in and I really believe in EQUI […] We’ve already got over 20 businesses that we are looking at and we haven’t even officially launched yet. It’s going to be very exciting. Ultimately, our mission is to seek, support and fund the blockchain and tech stars of tomorrow.”

Lady Mone OBE, co-founder of EQUI said:

“Woz has always been my business icon and it’s a dream come true to be working with him at EQUI.”

Steve Wozniak continued:

Doug Barrowman

“There are so many great ideas because I sit down and think, ‘what could I think of doing?’ And it’s usually based upon ‘what do we have today in our life and how could we modify it, make it a little better or radically change it?’ and I don’t come up with many answers. But then I run it at other people and almost everybody has one answer for one thing that I think ‘woah, I never would have thought of that’ so it’s out there in the technology field. Not only that, technology really enhances every other business there is. Construction businesses are totally enhanced. Even things like restaurants are totally enhanced by the technology we create. It takes people who have ideas, but not just ideas, not ideas in their head, not ideas that are spoken, not ideas just on paper, they actually do work and create things. I know that we have something very special with EQUI. I’ve since enjoyed giving my feedback to the technical side of the initiative and will very much be an actively involved proud co-founder.”

As part of its strategy to build a digital asset custody ecosystem, SIX has taken a minority stake in PassOn AG, a Swiss start-up specialising in the transfer of digital assets as part of inheritances. As part of the investment by SIX, Valerio Roncone, Head Product Management & Business Development, Securities & Exchanges at SIX, will become a Board Member of PassOn AG.

Seamless transfer of digital assets

Valerio Roncone comments: “The challenge in the digital asset space is to ensure clean, transparent and legally binding title to the assets between parties. This requirement is identical for counterparties who are exchanging assets whether they are living or deceased. The Distributed Ledger-based solution developed by PassOn will help enable such asset transfer seamlessly.”

Stephan Wippermann, CEO, PassOn AG, added: “We aim to leverage the latest Blockchain and Smart Contract technologies to bring inheritances into the digital age. We are preparing our ICO to fund the development of our digital estate planning and inheritance platform. In parallel, we will explore how to use SDX offerings such as listing or secure storage of the PassOn AG coin to leverage the SIX digital ecosystem.”

Introducing SIX Digital Exchange

In July, SIX had announced launching SIX Digital Exchange (SDX) to address the opportunities in the digital asset space.PassOn is a Swiss startup for asset transmission and storage on blockchain. Using the latest technologies, PassOn works closely with regulators, established market players and lawmakers capable of building a new global standard.

The study, which was conducted by Accenture with additional support provided by technology service providers Digital Asset (DA) and R3, proved that DLT can perform at levels necessary to process an entire trading day’s volume at peak rates, which equates to 115,000,000 daily trades, or 6,300 trades per second for five continuous hours. Currently, public blockchains supporting crypto-currencies operate at single or double digit per second performance, which until now was the only indication of the potential volume that a private DLT might be able to support.

DTCC noted that the study provided a starting point and only tested basic functionality. Additional work will be necessary for DTCC to determine if DLT can meet the resiliency, security, operational needs and regulatory requirements of its existing clearance and settlement system.

Murray Pozmanter, Head of Clearing Agency Services at DTCC, said, “We are excited to lead this important work to advance the performance capabilities of DLT and help create new possibilities for leveraging the technology more broadly across financial markets. As an early adopter of DLT, we are encouraged by the results of the study because they prove that the technology’s performance can scale to meet the needs of markets of different sizes and maturity.”

Functional Prototype of US Equity Clearance & Settlement System

DTCC commissioned the benchmark study and provided expertise and requirements for Accenture to build functional prototypes of the US equities clearing and settlement system using DLT. During the 19-week study, DTCC and Accenture ran DLT performance tests using commercial DLT platforms offered by Digital Asset (DA platform) and R3 (Corda platform), whose engineers provided support on performance tuning. DTCC’s main objective was to analyze DLT’s ability to process the massive trading volumes of the US equities market, not the capabilities of individual commercial platforms.

Accenture built a network of more than 170 nodes to model the financial ecosystem of exchanges, market participants and broker/dealers supported by DTCC. The prototypes were designed to test the capture of matched equities trades from exchange DLT nodes, novation of those trades with DTCC acting as the central counterparty (CCP) to maintain trading anonymity on the ledger, creation of netted obligations and settlement of the trades. The test environment for this study was setup in the cloud.

David Treat, Managing Director, Global Blockchain Lead, Accenture.

“This project answered key questions and built serious confidence in blockchain’s ability to drive large scale transformation,” said David Treat, Managing Director, Global Blockchain Lead, Accenture. “The close collaboration with the DTCC and our alliance partners, Digital Asset and R3, enables us to push DLT performance to new levels against real world requirements and conditions.”

“DTCC has been actively involved in DLT projects for over 3 years and during that time, we have seen technology platforms continue to mature, but concerns have loomed around the scalability of DLT,” stated Rob Palatnick, Managing Director of IT Architecture at DTCC. “This study is a natural next step in our efforts to advance the use of DLT, and we look forward to continuing to work collaboratively with the industry to identify new opportunities to use the technology to enhance the post-trade process.”

ASIC Commissioner John Price said, ‘If you raise money from the public, you have important legal obligations. It is the legal substance of your offer – not what it is called – that matters. You should not simply assume that using an ICO structure allows you to ignore key protections there for the investing public and you should always ensure disclosure about your offer is complete and accurate.’

Recent activity by ASIC

In five other separate matters since April 2018, ASIC successfully acted to prevent ICOs raising capital without the appropriate investor protections. These ICOs have been put on hold and some will be restructured to comply with the applicable legal requirements.

ASIC is taking further action in respect of one completed ICO.

On 13 September 2018, ASIC issued a final stop order on a Product Disclosure Statement issued by Investors Exchange Limited (IEL) for units in the New Dawn Fund (Fund). The Fund was proposing to invest in a range of cryptocurrency assets. Following ASIC raising concerns about the PDS, IEL consented to a final stop order so that no units could be obtained under the PDS. ASIC acknowledges the co-operative approach taken by IEL in responding to ASIC’s concerns.

Investor warning

As outlined on MoneySmart, ICOs are highly speculative investments that are mostly unregulated, and while there are genuine businesses using this structure many have turned out to be scams. ASIC suggests that investors consult the information on Moneysmart before deciding to invest.

As part of the Poloniex team’s continuous effort to improve the performance of the exchange and to better serve our customers, we are announcing that on September 25th at 12:00 ET we will be delisting eight assets: BTCD, BTM (Bitmark), EMC2, GRC, NEOS, POT, VRC, XBC.

Customers have until October 25th at 12:00 ET to close out any trades and withdraw any balances in these assets. Our goal for all delistings is to make this process as painless as possible for customers, which is why we always endeavour to:

Provide you with seven days advance notice before removing a market

Give holders of the impacted assets 30 days to withdraw funds from delisted assets

Use as many means of communications as possible

In the rare event that wallet availability is interrupted, we may extend the deadline and contact holders of impacted assets via email. There may also be times when customers are unable to withdraw delisted assets for reasons outside of Poloniex’s control, such as when a network is no longer live. In these situations, we will secure the delisted funds in cold storage with the potential to online the funds and allow customers to withdraw should the network become operational again. We will handle these scenarios, which we recognize can be frustrating for customers, case by case.

Once the withdrawal deadline has been reached (October 25th at 12:00 ET), withdrawals will be disabled and the asset will be fully decommissioned. From this point forward, we will be unable to process withdrawals of impacted assets. It is imperative that customers withdraw delisted tokens by the withdrawal deadline.

Please visit our Help Center article for more information about our delisting process, in addition to an update about previous delistings and our statement about the BitcoinDark network.

We greatly appreciate your support as we work to continuously improve the experience on Poloniex.

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